1. 1 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. A U D I T Single Audit Training California State University

2. 2 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Agenda Module I Introduction Overview of the A-133 Audit Schedule of Expenditures of Federal Awards Authoritative Literature and Resources

3. 3 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Module I Single Audit Overview

4. 4 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Reports Issued in Connection with a A-133 Audit

5. 5 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Types of Federal Awards Project grantsFunding for fixed periods of specific projects. Examples include fellowships, scholarships, research grants, training grants, etc. Cost-reimbursement contractsEntities provide goods or services to the federal government on a cost- reimbursement basis. Formula grantsAllocations of money made in accordance with a distribution formula prescribed by law. Direct loansFinancial assistance provided through the lending of federal monies for a specific period of time, with a reasonable expectation of repayment.

6. 6 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Entities Subject to A-133 Audit An entity is subject to the A-133 Audit if it spends US$500,000 or more in federal awards  States and local governments  Non-profit organizations  Higher education institutions  Hospitals

7. 7 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Determining When a Federal Award Is Expended Amount of federal awards expended is the basis for determining if A-133 audit is required  Based on when the activities that require compliance with laws, regulations and the provisions of the contracts or grant agreement takes place  Definition of expenditure may differ from GAAP

8. 8 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Determining When a Federal Award Is Expended (Continued) Grants, cost-reimbursement contracts, cooperative agreements, and direct appropriations When the expenditure/expense transaction occurs. Loans and loan guaranteesGenerally, when the loan proceeds are disbursed (lender) or received (borrower), plus any interest subsidy, cash, or administrative cost allowance received. Property, including donated surplus property When the property is received. The amount considered to be expended is the fair market value of the donated property at the time of receipt or the assessed value provided by the federal agency. Amounts passed through to subrecipients When the disbursement is made by the pass-through entity.

9. 9 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Schedule of Expenditures of Federal Awards (SEFA) Auditee’s responsibility to prepare List of individual federal programs by federal agency Federal awards received as a subrecipient  Name of pass-through entity  Identifying number assigned by the pass-through entity Total federal awards expended by program  Catalog of Federal Domestic Assistance (CFDA) number or other identifying number Amount of pass-through awards from each federal program Noncash awards in either the schedule or a note to the schedule Include notes that describe the significant accounting policies used in preparing the schedule Accrual or other disclosed basis of accounting

10. 10 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. SEFA Example XYZ Foundation/Campus Schedule of Expenditure of Federal Awards For the Fiscal Year Ended June 30, 2008 CFDA # Pass-Through Id# Expenditure U.S. Department of Agriculture Direct Programs: Food Donation10.550 $1,000,000 Passed through the State Department of Education: Child and Adult Care Food Program10.558C-104622 $ 500,000 Total U.S. Department of Agriculture $1,700,000 U.S. Department of Justice Passed through the State Department of Corrections: Juvenile Accountability Incentive Block Grant16.5232007TFEKI8954 $ 100,000 Local Law Enforcement Block Grants16.5922006SHWX0688 $2,000,000 Total U.S. Department of Justice $2,100,000

11. 11 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. SEFA – YES Reporting Package Schedule of Expenditure of Federal Awards For the Fiscal Year Ended June 30, 2008 1) Student Financial Assistance Cluster 2) Additional Programs  For #1 and 2 above, each entity is Required to list:  CFDA #,  Federal Expenditures,  Federal Grantor Agency,  Pass-Through Agency,  Pass-Through Entity Identifying Number and  Amounts Provided to Subrecipients 3) Federal Perkins Loan Program Information (e.g., Total borrowers not in repayment status, borrows on schedule in repayment status, borrowers in default, etc.) 4) Administrative Cost Allowances  Federal Perkins Loan Program  Federal Supplemental Educational Grant Program  Federal Work-Study Program

12. 12 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Authoritative Literature Office of Management and Budget (OMB) Circular A-133 The OMB can be obtained through the Internet at http://www.whitehouse.gov/omb/circulars/index.html http://www.whitehouse.gov/omb/circulars/index.html Cost Principles  OMB Circular A-21—Higher Educational Institutions  OMB Circular A-87—State & Local Governments  OMB Circular A-122—Non-Profit Organizations  Health and Human Services at 45 CFR Part 74 Appendix E - Hospitals

13. 13 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Authoritative Literature (Continued) Administrative Requirements  OMB Circular A-110 – Non-Profit, Higher Education & Hospitals  A-102 Common Rule – State and Local Government CFR references for specific agency A-102 requirements in OMB A- 133 Compliance Supplement (Appendix 2)  Education 34 CFR 80  Health and Human Services 45 CFR 92  Agriculture 7 CFR 3016

14. 14 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Other Program Information CFDA The Catalog of Federal Domestic Assistance (CFDA) contains background information and a brief description of some of the major requirements for each federal program. Each program in the CFDA has a federally assigned index number (CFDA number) to identify itself. Among other things, each program listing includes:  Name of the federal awarding agency  Statutory and regulatory cites  Program objectives (usually derived from legislative language)  Type of assistance (financial, non-financial)  Use and use restrictions  Eligibility requirements and the methods used to ensure they are met  Formula and matching requirements  Reporting and recordkeeping requirements The CFDA can be found through the Internet at http://www.cfda.gov/.http://www.cfda.gov/

15. 15 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Other Program Information CFR The Code of Federal Regulations (CFR) is a multivolume manual which represents the actual laws placed in effect by the federal government related to each program. CFRs are referenced throughout the OMB Circular A-133 Compliance Supplement as the authoritative literature for the various requirements that are being tested.  The CFR can be obtained through the Internet at http://www.gpoaccess.gov/nara/index.html. http://www.gpoaccess.gov/nara/index.html

16. 16 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Other Program Information USC The United States Code (USC) is the codification by subject matter of the general and permanent laws of the United States.  It is divided by broad subjects into 50 titles and published by the Office of the Law Revision Counsel of the U.S. House of Representatives.  It is published every six years. In between editions, annual cumulative supplements are published in order to present the most current information. USCs are also referenced throughout the OMB Circular A-133 Compliance Supplement as the authoritative literature for the various requirements that are being tested.  The USC can be obtained through the Internet at http://www.gpoaccess.gov/uscode/index.html

17. 17 ©2008 KPMG LLP, a U.S. limited liability partnership and a member firm of the KPMG network of independent member firms affiliated with KPMG International, a Swiss cooperative. All rights reserved. FOR INTERNAL USE ONLY. Questions?